World's first green bank loans $1bn in first months of operation

LONDON

LONDON May 9 Britain's Green Investment Bank
(GIB), the world's first bank solely focused on lending to clean
energy projects, said it allocated 635 million pounds ($988
million) in funding over its first five months of operation.

The bank, which opened in November 2012 and is capitalised
with 3 billion pounds of government money, supported eleven
projects over its first five months, most of which manage or
produce energy from waste.

Britain needs to drastically cut its carbon emissions by
2020 and set up the GIB in Edinburgh to help finance projects
that reduce the intensity of climate-harming greenhouse gases.

The single largest deal struck by the bank, which employs 74
staff and expects to count 100 by the end of the year, was for
125 million pounds to help finance the government's programme to
improve home insulation, known as the Green Deal.

The bank said its own investments unlocked an additional 1.7
billion pounds of third-party lending.

A 100 million pound loan to UK power producer Drax,
for example, resulted in another 890 million pounds in lending
from other parties for a project to transform half of its coal
capacity to burn biomass instead.

"Today's results show that the bank is doing precisely what
we set it up to do - draw in and not shut out private sector
capital," said Britain's Business Secretary, Vince Cable, who
helped set up the institution.

The bank's effectiveness has been criticised as it is not
able to borrow money itself.

Powers for the bank to raise funds were expected to come
into force around 2015, but the government said on Thursday the
bank did not need to borrow in the short- to medium-term.

"The level of funding for the GIB after 2014/15 will be
determined at the next spending review," a spokeswoman for the
department for business said.